what do I do??

Freight Broker said:
And...if the manufacturer is made to pay twice the broker gets away scott free... and the broker goes on to do it again and again and agian knowing that the carriers are not really that serious about following up and collecting.
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Sorry, but the broker will not go scott free, i doubt his client will like to pay double for every load that he books. He will simply lose the client, witch in turn will go against thee broker for the money that he paid too much. Is it fair for the manufacturer or client to have to do that ? NO But it's the same for the carrier. The law is made that way. The brokers have a lot of the privileges but not much of the responsabilities and i am a broker myself.
 
So if you buy a tire from Joe's Tire shop..and good old Joe doesn't pay his supplier, Goodyear, it is ok then for Goodyear to come after you for the payment of that tire...you pay twice for that tire. I can see that .....you're right..that's fair..because you should have known that Joe's Tire isn't paying his bills and therefore you are responsible... That's your logic...
 
Freight Broker said:
So if you buy a tire from Joe's Tire shop..and good old Joe doesn't pay his supplier, Goodyear, it is ok then for Goodyear to come after you for the payment of that tire...you pay twice for that tire. I can see that .....you're right..that's fair..because you should have known that Joe's Tire isn't paying his bills and therefore you are responsible... That's your logic...
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Those are consumers laws and therefore not aplicable. I understand your reasoning about going after the freight broker for payment. As is said in my previous post it's not fair for the manufacturer/client to have to pay twice, but neither is it for the carrier not to be paid at all. The regulations of this industry are flawed in that aspect. But just to go back to your analogy, Goodyear is at the top of your pyramid as in this case the carrier is the low guy on the totem pole.
 
The other way to look at it is....
If you paid Charlie to get you some tires and he went to Joe's and got them installed on your car, but never paid Joe, then you are responsible since you are the benificial owner of the tires.
 
warex187 said:
Sorry, but the broker will not go scott free, i doubt his client will like to pay double for every load that he books. He will simply lose the client, witch in turn will go against thee broker for the money that he paid too much. Is it fair for the manufacturer or client to have to do that ? NO But it's the same for the carrier. The law is made that way. The brokers have a lot of the privileges but not much of the responsabilities and i am a broker myself.
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That's right...and we help those bad operators along by not holding them accountable...or at least not as accountable as they should be. We know from the get go what the potential problems are with brokers...so we need to make sure we protect ourselves from the get go. Get the bond...verify the physical address of the place...along with the name and address of the principles... get three references...and by all means circle the wagons and deal with as few brokers as possible. Don't count on the link or the government to do this for you..it is YOUR business..and ensuring that the people you deal with are creditworthy is YOUR responsibility. Likewise, it is a broker's responsibility to ensure the carriers he hires are qualified...We all have our responsibilities and when we fail to carry them out we suffer the consequences.
 
What is with these stupid analogies?????? The law clearly states that if you are not paid by the broker you can go after the consignee so why wouldn't you? It is our only recourse in this business.
 
How about we look at it like this:
Guy buying the tires = carrier
Joe's Tire Shop = broker
Goodyear = Manufacturer

The carrier agrees to take 10 Goodyear tires from Joe as long as they move freight from point A to point B. When the carrier completes this, Joe doesn't want to give the carrier any tires. Because Joe specifically said Goodyear tires, the carrier goes to Goodyear to get the tires. Goodyear already gave Joe 10 tires and now they have to give the carrier 10 more. Goodyear gives the carrier 10 tires because they are a reputable company and don't want bad publicity. Goodyear then charges Joe for the 10 tires they supplied to carrier. Goodyear also cuts off Joe's Tire Shop and now he is reduced to selling retreads.

The law works to protect the service provider because there are actual costs, not least of them labour charges. The people responsible for the freight are responsible to pay for it and if they pay the wrong entity, they pay again until they get it right. After that, they can deal with the other people who caused the grief to recoup their money. This type of thing happens and the Mercantile Act provides the best possible solution to it. I made it, I'm responsible to make sure the right person gets paid for moving it for me. If I choose to use a third party, I still maintain ultimate responsibility. If I choose to disregard that responsibility, why should anyone else pay? If the consignee winds up paying for it, don't you think they will ask for and get a credit from the manufacturer? Eventually, the unethical broker will get tapped. If manufacturers kept track of these crooks and passed it on to their associations we might not have this problem. Due diligence applies to everyone, equally.

My 2 cents.
 
RK in MB said:
How about we look at it like this:
Guy buying the tires = carrier
Joe's Tire Shop = broker
Goodyear = Manufacturer

The carrier agrees to take 10 Goodyear tires from Joe as long as they move freight from point A to point B. When the carrier completes this, Joe doesn't want to give the carrier any tires. Because Joe specifically said Goodyear tires, the carrier goes to Goodyear to get the tires. Goodyear already gave Joe 10 tires and now they have to give the carrier 10 more. Goodyear gives the carrier 10 tires because they are a reputable company and don't want bad publicity. Goodyear then charges Joe for the 10 tires they supplied to carrier. Goodyear also cuts off Joe's Tire Shop and now he is reduced to selling retreads.

The law works to protect the service provider because there are actual costs, not least of them labour charges. The people responsible for the freight are responsible to pay for it and if they pay the wrong entity, they pay again until they get it right. After that, they can deal with the other people who caused the grief to recoup their money. This type of thing happens and the Mercantile Act provides the best possible solution to it. I made it, I'm responsible to make sure the right person gets paid for moving it for me. If I choose to use a third party, I still maintain ultimate responsibility. If I choose to disregard that responsibility, why should anyone else pay? If the consignee winds up paying for it, don't you think they will ask for and get a credit from the manufacturer? Eventually, the unethical broker will get tapped. If manufacturers kept track of these crooks and passed it on to their associations we might not have this problem. Due diligence applies to everyone, equally.

My 2 cents.
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No doubt...but the law inadvertently lets the broker off the hook. The crooked broker probably knows you can legally go after the shipper/receiver, so he feels less pressure to pay the carrier himself as a result..the law thus perpetuates the problem...and that law probably needs to be changed. Brokers, for the most part, are honest and pay their bills promply...and before you laugh about it... you know it must be true because very few people bother to check a broker's credit...I do 4 million in sales a year...and I might get 4 request for credit references in that year... Now, I'm an honest guy, so it doesn't matter to me...just sayin we should perhaps first do our jobs properly before we try to hook our lack of due diligence on others or blame the government for having inadaquate regulations and safeguards.
 
Shipper

This type of situation does little good to any of the parties involved.

Although I beleive the most hurt by this are the (honest, legit) I am not sure how to categorize, load brokers.
If I was a shipper and would be caught having to pay twice for the same service, the experience would be burned into my memory. I would make sure to minimalize my risks in the future I would only deal with carriers. Thus removing one element of risk!!
 
Freighbroker everything you say is true but and it is a big but the only person out money in this scenario is the carrier and you know as well as I do if it is a bad broker and they have no intentions of paying then a judgement means nothing also. By the time all of this is done the timeline is at least 6 months and still the only party that is SOL is the carrier. Take all means possible and get your money do not limit yourself go after everyone involved asap because if you don't you will be the one still out the money.
 
True..but such is life in a receivables type business. Brokers have the same problems with getting paid. The risk of getting paid for services rendered cuts across all businesses that extend payment terms. I deal with it more aggessively than most, and I won't get into it here... Sometimes you have to let it go...sometimes people are in dire straights and CAN'T pay their bills, even though they may be honorable well intentioned people. And in that case all one can really do is cut one's losses and move on...not everyone in dire straights is a crook.
 
Maskigirl

Just to go back to what originated this great back and forth.

Who exactly is the broker that is ignoring his financial responsabilities ?

I am pretty sure it would be useful to some carriers on this forum, like not to work for him in the future.
 
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Yes, that's a GREAT IDEA, post their name, so guys like me ( A Carrier ) sick of being screwed with meaningless promises just to get the job done then all of a sudden," Oh we're sorry they wouldn't pay extra for that". I miss the good ole days when you delivered the load you got a Com-check right then & there after faxing in the POD. Then the broker had to contend with non-paying shipper/receivers. My 2 cents.
 
We still need to contend with nonpaying shippers/receivers...same old same old... Statements like "sorry the shipper/receiver wouldn't pay it" can be minimized by making sure your contract stipulates that your monies owed are not contingent on the broker's deal with his customer. Too many problems in this industry are due to slap dash procedures that are done in haste. I have to admit to being guilty of that myself from time to time...but I'm aware of it and make an effort to cross all my ts and dot all my i's before getting involved with someone I don't know.

If I were a carrier I would deal with a small group of brokers and add to that small number very carefully and slowly. I would "test run" every broker I hired by taking a load and from there determine how long it takes to get paid. and then, very slowly, I would give them progressively more credit based on their performance in all areas. That's what I do with shippers...I give them ONE chance...I move a load for them..and sometimes that is the LAST load I move for them.
 
I've read through all the posts related to this thread, and the bottom line is a broker's loss and a carrier's loss are two very different things. We deal with some incredible brokers, but last time I checked, a broker doesn't pay for things like truck payment, plates, fuel, toll charges, maintenance charges etc. etc. etc..... As a carrier we pay up front for all these "overhead charges" on top of an office, internet etc. and so when a broker doesn't pay his bill, not only are we out our revenue, we also suffer a loss. Why is this industry the only one where you perform the entire service and then wait 30, 45, 60, 120, forever to be paid ???? And when you aren't paid, and you've attempted to just deal with the broker who lies/hides/doesn't answer calls, you're not supposed to contact the shipper or consignee to collect the payment you've already earned ??

Wow.
 
Last I checked we DO pay for those things...albeit indirectly...along with your profit markup..

Lots of other induistries extend payment terms...it is not unique to freight brokerage.

As in any other industry..you should go after the person who owes you the money...however, only in the freight business (thanks to the Mercantile Act I guess) can you go after another party who is totally innocent for payment.

BTW..lots of carrier play the lie and hide game as well...
 
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The rational for my opinion

There's more than a little jurisprudence deciding various claims against brokers, shippers, receivers and carriers. Some of the decisions rendered would leave me scratching my head until I read the judges reasons for their decisions. I have developed more than a little respect for these learned members on the bench for the way they can parse each action and get through the posturing, confusing behavior, and ill-cited case histories and come up with what's reasonable. To force a party to pay twice may seem unfair and illogical at the outset, but there are times when it is the correct decision. By and large, what is expected is that people do what a reasonable and informed person would do under similar circumstances.

I do know that if a carrier successfully gets a judgment against a broker, the legal liability the shipper or consignee did have evaporates with it. The carrier cannot then sue them as an alternative to unsuccessful collection attempts against the judgment debtor (broker). Even the best due diligence can not always protect you from thieves and charlatans, so the courts are busy. As a broker I have to support any carrier who in spite of their best efforts to ascertain the character of whomever they do business with, wind up getting screwed. Without carriers, I have nothing to sell and therefore no business.
 
In other words you pay the carrier even when the shipper does not pay you. congrats..that's the way i operate as well. Thus we do take responsibility although that responsibility is often not imposed upon us by law.

We need carriers...they need us...hence we all continue to exist...
 
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